Want States to Pay for Climate Resilience? Don’t Sue Them for Trying

Cancel culture is all the rage in the Trump administration. From late night hosts to green energy projects, when the feds deem something objectionable, they’ve been quick to shut it down.

This is as true for the country’s first Climate Superfund laws as it is for Jimmy Kimmel. With a flurry of legal filings, the Department of Justice (DOJ) is maneuvering to invalidate statutes passed by New York and Vermont that aim to raise billions of dollars from oil and gas majors to pay for much-needed adaptation projects.

On August 29, the DOJ filed a motion for summary judgement in a district court in New York as part of its lawsuit against that state’s Climate Change Superfund Act, which was signed into law last December. And just this Monday (September 15), the department filed a similar motion in another district court against Vermont’s Superfund, which was the first to be established in the country. In both cases, the Trump administration’s goal is simple: to have the courts render the laws “invalid and unenforceable.”

It’s a significant — if not entirely unexpected — escalation of the federal government’s legal assault on states’ climate policies. In April, President Trump signed an executive order directing the Attorney General to challenge laws that could affect “domestic energy resources”, prioritizing those addressing climate change. The DOJ filings serve to put this order into effect.

“I think it is a sign of aggression,” says Rachel Rothschild, an Assistant Professor at the University of Michigan Law School who specializes in environmental law. “It is unprecedented in the environmental context for the Department of Justice to sue states in this way — they've never done anything like this before over any other state environmental law.”

However, the legal attack also exposes a contradiction at the heart of federal disaster policy. President Trump — through his rhetoric and executive orders — has made clear that primary responsibility for financing resilience against extreme weather events should rest with states and local governments. Yet by targeting the Superfunds, his administration is undermining one of the key mechanisms these governments could use to raise the necessary funds.

It’s a conflict that, if unresolved, could leave Americans even more vulnerable to climate disasters than before. 

New York and Vermont are the first — and so far only — states to enact Climate Superfund laws. But it’s an idea that’s catching. Ten state legislatures have introduced similar bills, while another two have introduced ‘Climate Study Bills’ which, if passed, would commission research into the financial cost of climate damage within their borders.

The Superfund laws rest on a simple principle: polluter pays. It’s one borrowed from the successful authorization of the original Superfund law in 1980, which empowers the Environmental Protection Agency (EPA) to charge companies for the clean up of toxic waste dumps.

Under the New York and Vermont laws, fossil fuel majors are obliged to pay into special adaptation funds in proportion to their historical emissions (calculated for the period 2000-2024 for New York, and for 1995-2024 for Vermont). The New York law caps the payments at US$75bn over a 25-year period. Payments under the Vermont law are calculated against the total climate damages inflicted on the state, and have to be made within ten years.

“This is an ambitious concept,” says Amanda Halter, a Managing Partner at Pillsbury, a law firm. “To say that you’re going to essentially provide retroactive liability over — in many instances — permitted or lawful emissions, and that you're going to allocate this liability on a strict basis … that’s a really ambitious thing to do.”

Ambitious — but perhaps justified. Especially considering the climate damages these states are suffering. In 2022 alone, massive floods caused over US$5bn in property damage in Vermont. In New York, flood-related losses have totaled around US$26bn over the past decade.

And it’s not as if the oil majors these laws target are hard up. The net income of the three largest US fossil fuel producers — ExxonMobil, Chevron, and ConocoPhillips — came to a combined US$60.6bn in 2024.

Moreover, there’s a growing body of research that draws a direct line between extreme weather events and these producers’ climate pollution. ‘Attribution science’, as it’s known, compares the frequency and severity of events like hurricanes, floods, and heatwaves in today’s climate with a hypothetical world without human-caused climate change. Researchers then calculate each company’s share of global greenhouse gas emissions, allowing them to attribute part of the increased intensity and occurrence of extreme weather to specific organizations.

In a paper published in Nature just this month, the authors estimate that the emissions of 180 “carbon majors” contributed to half the increase in heatwave intensity since 1850-1900, and that every company analyzed — even the smaller ones — contributed substantially to their increased occurrence. Studies like this have fueled the arguments of policymakers pushing for a Superfund-style approach. Now, those arguments are facing legal scrutiny.

“The science and the policy is happening in parallel,” says Halter. “Whether [attribution science will] ultimately be compelling in a court of law with evidentiary standards: TBD.”

The emissions-to-climate-damages link is a cornerstone of the DOJ’s argument for invalidating the Climate Superfund laws — albeit indirectly. In both motions for summary judgment, the Trump administration is making three core claims: one, that the states are pre-empting federal law; two, that the Superfunds exceed the limits of states’ regulatory power; and three, that they disrupt and frustrate lawful out-of-state commercial activities.

The latter two claims center on the Superfunds’ targeting of carbon majors based on their global emissions. This, the feds argue, represents an egregious overreach of state power. “[T]he Superfund Act transgresses the Federal Constitution’s limits on extraterritorial legislation by nationalizing (and even globalizing) [New York’s / Vermont’s] legislative power,” the DOJ’s argument reads. 

It is true that little to no fossil fuel production takes place in either state, and that neither produces substantial emissions. However, the Superfund laws are not seeking to regulate carbon majors based on their out-of-state emissions. Indeed, the texts have nothing to say about their ongoing pollution.

New York and Vermont are instead using companies' past emissions as a measuring tool to calculate their respective contributions to their adaptation funds. Doing so makes sense. After all, it doesn’t matter where greenhouse gases are emitted. They are all absorbed into the same atmosphere shared by all fifty states, and all have an influence on worsening extreme weather events. 

Rothschild adds that it is “appropriate” for states to hold companies liable for harms resulting from activities that occur out-of-state, and that this is “a long standing principle that has been upheld in numerous Supreme Court decisions,” including a 2021 ruling against Ford Motor, which concluded that a company can be brought to court in a state where its products are not sold, manufactured, or distributed, so long as other conditions are met. “States are going to need to make the case that the companies that they want to hold responsible … have enough of a business presence, economic presence, [or] marketing in the state that it is reasonable to hold them liable for these climate harms,” says Rothschild.

Also conflicting with the DOJ’s claims of extraterritoriality is the fact that New York and Vermont are not forcing carbon majors to pay for climate damages beyond their own borders. “We’re not interfering with any efforts at a national level or international level to control emissions. What we’re talking about is calculating the damages that these companies have caused within Vermont,” says Kate Sinding Daly, Senior Vice President for Law and Policy at the Conservation Law Foundation (CLF), one of the defendant-intervenors in the Vermont lawsuit.

The Trump administration’s other claim — that the Superfund laws infringe on federal jurisdiction — is similarly flawed in Daly’s eyes. While the DOJ claims that the federal Clean Air Act “regulates domestic greenhouse gas emissions that originate out of state” and cannot be pre-empted by state-led climate policies, as explained above the Superfunds are not looking to curtail companies’ current and future pollution. 

There’s also a wry irony in the administration’s attempt to use the Clean Air Act as a legal shield at the same time the EPA seeks to rescind the 2009 Endangerment Finding — which classified greenhouse gases as pollutants the federal government is allowed to regulate in the first place. “Maybe there’s a little bit of talking out of both sides of their mouth,” says Jillian Marullo, Special Counsel at Pillsbury. 

The DOJ’s efforts to quash the Superfunds could also undermine the president’s own policy agenda on resilience and disaster recovery.

In March, Trump signed an executive order — “Achieving Efficiency Through State and Local Preparedness” — which calls on states, local governments, and individuals to play “a more active and significant role in national resilience and preparedness”, on the basis that these objectives are “most effectively owned” at these levels. It’s part of his broader drive to shift the burden of disaster response and recovery away from central government, one intimately tied up with his planned reforms of the Federal Emergency Management Agency.

But if local authorities are expected to shoulder more responsibility, they need more money. Superfund laws are one way — and the fairest way, according to proponents — for states to raise the revenues necessary to harden them against escalating climate shocks and build more resilient communities.

“Taking the federal Superfund framework and the polluter pays principle and applying it to climate is a reasonable way to approach the damages that we're seeing from the climate crisis,” says Erin Doran, Senior Staff Attorney at Food & Water Watch, a non-profit that lobbied for New York’s Superfund law and is taking steps to join its defense.

She notes that the way New York’s law is written allows any adaptation funds — if and when they’re collected — to be directed by the priorities of climate-impacted communities themselves. That approach appears to align with the goals of Trump’s local preparedness order.

For her part, Daly at the CLF believes states have the right to use their revenue-raising powers to plug financing gaps that federal policy is opening up. “The state [Vermont] clearly has the authority to take measures to protect their citizens,” she says. “They [the federal government] say you have to bear these costs but can’t ask the companies responsible for these costs — that are raking in billions in profits every year — to pay for their responsibility.” 

The ultimate fate of the New York and Vermont laws may not be known for some time. As things stand, New York and its co-defendants have until the end of October to respond to the DOJ’s motion for summary judgment. Vermont plans to file its response by November 17. It will then be up to the two district courts to decide whether to rule based on the existing facts — or seek further evidence from the various parties.

Whatever the courts’ decisions, appeals are likely — as is an escalation to the Supreme Court, which may have the final say on the Superfunds’ constitutionality. According to Rothschild, those rulings could shape how other states approach climate liability laws. For instance, if the Supreme Court finds that the Clean Air Act overrides state-level Superfunds, it would severely limit the chances of passing similar laws elsewhere. But if the Court instead rules that only specific technical elements of the laws conflict with federal statutes — while upholding their broader constitutionality — states could revise their legislation to avoid running afoul of the DOJ.

“If there are hiccups and glitches in how they are implemented, subsequent states can innovate on the model,” says Daly at the CLF. “It is a measure of solace for us that we do have a strong federal system in this country. So even though our national leaders have abdicated any responsibility for addressing the climate change we see is upon us, we can look to the states to fill the gap,” she adds.

Thanks for reading!

Louie Woodall
Editor